Northern Mariana Islands: Where the public pension fund went broke

The retirement fund is a defined benefit type pension plan and was only partially funded by the government, with only $268.4 million in assets and $911 million in liabilities. The plan experienced low investment returns and a benefit structure that had been increased without raises in funding.

Legal experts say this is the first time a retirement fund has declared bankruptcy and could establish a precedent.

The Northern Mariana Islands have a population of 53,883 (2010 census). More than 90% of the population lives on the island of Saipan. Of the fourteen other islands, only two — Tinian and Rota — are inhabited.